The Simple Brilliance Of GreenSky Credit’s Smartphone App

Forbes was recently allowed a rare look behind the scenes at GreenSky Credit. This financial tech company has been quietly building quite a portfolio in an oddly shaped basement in Atlanta, Georgia. Dozens of employees buzz about the open space perfecting a smartphone app for contractors.

Contractors aren’t generally the target of tech startups. But founder and CEO David Zalik bet on contractors to be the key in opening one of America’s prized demographics — homeowners. His bet paid off resoundingly and now he sits on a $2.5 billion fortune.

The smartphone app is rather simple yet astoundingly brilliant. It allows everyone involved to get exactly what they want. Contractors get more work, homeowners get the house of their dreams, banks get reliable loans and GreenSky Credit gets a financial piece of it all.

Contractors are better able to drum up work by promoting GreenSky Credit’s services. The services come via a smartphone app that homeowners can easily use. They choose a particular home renovation loan and are approved in minutes. Contractors then soon show up to begin renovations on the homeowner’s dream house. So far, everybody wins. But here’s where it gets really brilliant.

GreenSky Credit does not lend their own money. Instead, they take their prime loan seeker’s information to the bank. The bank then issues the loan and assumes all responsibility. David Zalik has figured out a way to make money without assuming any risk.

Everybody in the equation ends up paying GreenSky Credit. Contractors are happy to share 6% of the loan amount with the financial services company. And, of course, homeowners pay the contractors. A portion of which eventually ends up in the pockets of GreenSky Credit. Finally, the banks share 1% of their spreadsheet at the end of each year.

What’s even more impressive about this company is the founder’s story. David Zalik didn’t even finish high school but took out $10 million in loans to start his company. He eventually attracted investors before recently filing a confidential IPO with the Securities and Exchange Commission. His company is projected to make $500 million in revenues in 2018 alone.